Earlier this month, renowned Chinese analyst Ming-Chi Kuo revealed that Huawei may sell its subsidiary Honor. This information has now been confirmed by the Reuters news agency.
Huawei is in talks with Digital China Group, TCL, and Xiaomi to sell part of its Honor smartphone business to them, according to sources close to the company’s plans. If the deal goes through, the Chinese manufacturer will receive 25 billion yuan for it. That’s about $3.7 billion.
It is not known which part of Honor will be sold. Presumably, we are talking about the brand, the development department (R&D), and the supply management business. At the moment, Digital China Group is considered the leader of the deal. It was founded by Legend Holdings, which became Lenovo in 2001.
The partial sale of Honor’s business will help Huawei recover some of the costs. In addition, such a decision will allow the Honor brand to continue to exist on the market without falling under US sanctions. Also after the sale, Huawei will be able to focus on premium smartphones, as Honor is now mainly focused on low-cost devices.